Legal rights

Telemarketing

Updated 01 Apr 2010
Telemarketing-hero

Introduction

Every year, direct marketers "cold call" thousands of people. Most calls are a hassle. Some are scams. Here's how to fight back!

It's no surprise there's a rising tide of frustration against telemarketers. In this report, we explain how you can escape from the marketers lists, how to spot a scam, and steps you can take to safeguard your privacy.

How they find you

If a telemarketing company "cold calls", there's a chance it got your number from the phone book. But there are a host of other sources.

Marketing companies trawl through public registers - such as the local council's list of building consents - looking for personal information to help their sales pitch. Many companies, and even some government agencies, sell personal details to telemarketers.

Anytime you enter a competition, fill out a warranty card or subscribe to a magazine, the company will probably add you to its marketing database. It may on-sell your details (Consumer NZ doesn't).

If you're a TrustPower customer and you pay your bill on time, you'll automatically become a TrustPower "Friend". One reader told us how TrustPower telemarketers cold-called and tried to convince her to switch her toll account from TelstraClear to ihug. TrustPower says customers are given the option about whether they want to receive marketing information when they first join up.

What can you do?

Getting them to stop calling

The NZ Marketing Association operates "do not mail" and "do not call" registers, available free to consumers (not businesses). If you don't want to receive cold calls from telemarketers, your home contact details can be added to the list.

The Association's 500 members use the list to find out who doesn't want to be called. But it's not foolproof - you'll still get calls from companies that aren't members of the Association. There are similar schemes set up overseas.

To use the NZ Marketing Association registers (available only to consumers, not businesses):

  • Visit the Marketing Association website and add yourself to the 'do not call' and 'do not mail' lists.
  • Email the Marketing Assocation service with your full name, home address and home telephone number.
  • Or write (with your full name, address and telephone number) to Do Not Mail and Do Not Call Registers, Marketing Association, P O Box 47681, Ponsonby, Auckland.

Dealing with problems

First, try to resolve the matter with the company concerned - put your complaint in writing. If this doesn't work, write to the Association with supporting material and keep copies of all correspondence relating to your complaint: it will help resolve disputes involving members and, sometimes, non-members. There is no fee.

Complaints the Association receives about New Zealand telemarketers usually relate to lack of communication and the late or non-delivery of goods. These can often be resolved.

You can also take a complaint to the Disputes Tribunal. But, if the company was based overseas, you're probably out of luck.

Your legal rights

If you think a telemarketer has treated you unfairly, or misled or deceived you while you were buying a product, you have protection under the Fair Trading Act and can complain to the Commerce Commission.

If the telemarketer sends you goods that are faulty or aren't fit for the purpose you bought them for, that's a breach of the Consumer Guarantees Act and you're entitled to a refund.

The Door to Door Sales Act might also apply if you were cold-called and invited a sales rep to your home. This Act lets you get out of a credit contract for up to seven days after you've signed it - but it depends on what you bought and how much you spent.

If you gave out personal information about yourself for one purpose and it's been used for another, you have grounds for a complaint to the Privacy Commission. You can also complain if you think an organisation has information about you but won't let you see it.

Your privacy

Privacy

The Privacy Act requires anyone collecting your personal information to tell you the reason it is being collected, what it will be used for, and who will have access. (See our Privacy law report for more information.)

The Act prohibits anyone from gathering personal information for one purpose and using it for another, although there are some exceptions.

That's why most forms you fill out these days ask if it's okay for the information to be used for marketing purposes. Not surprisingly, this request is normally buried in the fine print.

Problems can arise if your details are in a public register and the register's purpose isn't clear.

The Privacy Act places limits on when government departments and businesses can give out personal information. Some departments, like the Inland Revenue Department (IRD), also have specific controls in their own legislation. For example, the IRD can't give out your income details to anyone - except for very limited purposes such as data-matching with other government departments to help catch benefit fraudsters.

The Privacy Act also means you have a right to see any personal information an organisation holds about you. You should not be charged.

If the organisation doesn't respond within 20 days, or you believe it may not have shown all the information it has on you, or it fails to correct any mistakes, you can ask the Privacy Commissioner to review the matter.

Collecting for charity

While most telemarketing charities are bona fide, you've got no way of knowing how much of your donation is going to the charity and how much is being pocketed by the telemarketers themselves. Our own investigation in late 2002 into the Children at Risk Education Foundation (CARE) found a staggering 75 cents in every dollar of donations was going to the telemarketing company (see our Giving to charity report for more information).

The Commerce Commission is responsible for registering and monitoring charities in New Zealand, under the Charities Act 2005. One of the requirements of registration is that a charity has to provide information about how and on what, donations are used.

If you are in doubt about whether a charity is genuine or not you can search on the Charities Register website. There is also a free information line 0508 charities (0508 242 748).

Registration as a charity is voluntary, however from July 2008 only charities that are registered are eligible for tax exemptions.

Our advice

  • Don't make instant decisions. Wait until you've seen all the details in writing.
  • If you think you're being called from overseas, don't buy. It'll be almost impossible to track them down if something goes wrong.
  • Watch what you say. In several cases we investigated, consumers' recollections of what they agreed to were wrong.
  • Keep records. Note the date of the call, the telemarketer's details, the conditions of the sale and any promises made by the telemarketer.
  • Make sure you can return goods if you find them unsatisfactory, find out the time period and who'll pay the postage.
  • Choose to be billed instead of paying upfront. That way, you'll get to see the goods before you pay. If you can't do that, pay by credit card - if there's a problem, you might be able to get a chargeback.
  • If you're caught out by misleading or aggressive marketing, don't pay the bill. Contact the company immediately to seek a refund.
  • If you find it hard to stand up to aggressive callers, get an answerphone or messaging service. It will screen your calls and you only need to respond to the ones you want. It's a small cost for peace of mind.
  • Use the NZ Marketing Association Name Removal Service (See What can you do?)

Spotting scams

Telemarketing is a haven for scam operators. Often, they call from overseas, meaning they're almost impossible to trace when things go wrong. Scam callers usually stick to tried-and-true methods, including:

  • Saying you've won a prize but you have to send money to get it.
  • Asking for your bank account number.
  • Claiming you'll make huge profits with no risk.
  • Refusing to send information before you buy.
  • Offering you work from home and then asking for your details.

Don't sign up to anything over the phone. Take time to think about it, and remember: if the deal they're offering sounds too good to be true, assume it is. Never give your bank details over the phone.

Scam callers can be relentless, even after you've warned them not to call again. If you are sure a caller is promoting a scam contact the Commerce Commission or even the police. An extreme step would be to change your phone number.

See our Scams resource for more information and our advice on Avoiding fake offers.

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